Hansard -- Volume 2, Number 5 -- Monday, July 30, 2001

The following electronic version is for informational purposes only.
The printed version remains the official version.

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY



CONTENTS

	Routine Proceedings
		Time

Oral Questions
Negotiations for nurses’ collective agreement		1405
	J. MacPhail
Government hiring process for senior ministry staff		1410
	J. Kwan
Flooding in Peace River area		1415
	B. Lekstrom
Meningitis outbreak in Fraser Valley		1415
	J. Les

Economic and Fiscal Update
Hon. G. Collins		1420
J. MacPhail		1500

Taxation Statutes Amendment Act, 2001 (Bill 2). Hon. G. Collins
Corporation Capital Tax Amendment Act, 2001 (Bill 3). Hon. G. Collins
Balanced Budget and Ministerial Accountability Act (Bill 4). Hon. G. Collins
Budget Transparency and Accountability Amendment Act, 2001 (Bill 5). Hon. G. Collins
Introduction and first reading		1505

J. MacPhail: Last week the Minister of Health Services called the potential for mass resignations of nurses nothing more than a PR exercise. "And where do they have to go anyway?" said he. Well, what he deems to be a little PR exercise is rapidly becoming a full-blown crisis. Yesterday the nurses announced that they have more than 5,000 resignations in hand, and counting.

To the Minister of Health Services: is it all still a PR exercise, or is it time to stop playing chicken with our health care system? What are his plans to negotiate a settlement that will keep nurses here in B.C.?

Hon. C. Hansen: First of all, I have never said that it was a PR exercise. I think there was a media report that attributed sentiments of that nature to me, but I have never said that. I fully recognize the frustration that nurses are going through. I fully recognize that nurses have watched the health care system deteriorate around them so that their ability to deliver care to their patients has been eroded over the last couple of years.

We have made it very clear that we have been more than fair — we have been very fair — in terms of the offer that is on the table today, which will make nurses the highest paid in terms of wages and benefits of any province in Canada. We want to make sure that we can work with nurses in British Columbia to deal with the other underlying causes of their frustration, so they can once again deliver patient care in a manner they will be proud of as the professionals they are.

J. MacPhail: I certainly feel badly that this Liberal Health minister is already being misquoted by the media. It is true that this minister said that there was no more new money, even though that was new information from the election — that there would be a freezing of the health care budget and that there would be no new money to resolve the nurses' dispute. That's new information in the last few weeks.

This government's Finance minister has managed to find $1.5 billion to fund tax cuts. In fact, 208 million of those dollars are going to the wealthiest British Columbians, who earn more than $250,000. In fact, the Minister of Finance took the opportunity over the weekend — reported in the newspapers, but maybe he's misquoted; it could be that he is misquoted on the front page of the Province — that there will be more tax cuts for big business….

Oh, so anxious to say: "Yay for the tax cuts for big business…." But what he can't do is bring himself to put more money into the health care system and resolve the dispute honestly and honourably now. So let me ask the Minister of Health Services, given his responsibility for health care in this province: what's more important — tax cuts for the wealthiest who earn more than $250,000 a year or our health care system in this province?

Hon. C. Hansen: During the election campaign we were very forthright with voters in British Columbia, and when the NDP party was going around this province saying we were going to cut health care spending, they were wrong.

Hon. C. Hansen: We made it very clear in the election campaign that we were going to maintain a health care budget in this province of $9.3 billion and increase it as the economy increased. The one thing that's different in this government compared to the previous government is that we actually have a plan, as you will hear unfold later this afternoon, to improve the economy of this province so that in future we can actually afford the health care system British Columbians deserve.

J. MacPhail: We are now facing in this province an increasing number — beyond 5,000 — of nurses who will leave this system. The Minister of Health Services said: "Where do they have to go?" Well, we know where nurses can go. This minister is responsible for keeping our health care system not only intact but improving as the pressures increase on them.

Let this minister rise today and tell the public: will he or won't he negotiate a fair settlement, even given what we anticipate is coming in this budget — massive tax reductions for his corporate backers? Will he stand up today and say that he will allow the nurses to share in some of that backing, even though he misled them during the election?

Hon. C. Hansen: It is not my job to negotiate the collective agreement. But those who are negotiating the collective agreement on behalf of this government have already done exactly what the member is asking: provided for a globally competitive wage for nurses in British Columbia that will make them the highest paid in Canada. In addition, as a result of the measures to promote economic growth that is necessary in this province, the nurses have also received the biggest reduction in their personal income tax that has ever happened in Canada and in this province, making

J. Kwan: Last week the government placed an ad in the Vancouver Sun seeking applications for deputy and assistant deputy ministers. The ad, in part, read that successful applicants must be able to "thrive in an environment of ambiguity and risk." Apparently just….

J. Kwan: Apparently, that's just another way for the government members to say: "Pay close attention to question period to find out how we're doing."

My question is to the Premier. Will the Premier today table the ad that his government has placed seeking applicants to fill the position of Deputy Minister of Intergovernmental Affairs — which, as we know, went to the president of the B.C. Liberal Party?

Hon. G. Campbell: The risk that British Columbians faced is, I think, obvious after the last ten years of NDP government. The risk that British Columbians have faced because of that former government's incompetence, the risk that they faced because of huge, multimillion-dollar investments like fast ferries that don't work, the risks that they faced because of the last government bailing out hundreds of millions of dollars for businesses that will never be successful, will be removed when we replace political appointments with professional, non-partisan people with talent and ability. That's what every deputy minister will have in this government.

J. Kwan: I have no doubt that Mr. Wilkinson possesses considerable skills and talents. Just look at the corporate funding that the Liberal Party has overflowing in their coffers. Can the Premier assure British Columbians that his office undertook a nationwide search to fill this position?

If the Premier is unable to table any documents with respect to Mr. Wilkinson's appointment, could he please inform the House what search process was conducted prior to the appointment of Ms. Kathryn Dawson — the former managing director of the Liberal caucus and a former executive assistant to someone named Stockwell Day — to the position of assistant deputy minister?

Hon. G. Campbell: I agree with the member that in fact Mr. Wilkinson has considerable skills and talents. It's not easy for us, after searching across the country for excellent civil servants who want to come and serve the people of British Columbia. But when you find someone who is a physician, who is a previous medical health officer, who is a lawyer, who is a Rhodes Scholar, and they're willing to serve British Columbians, we're going to bring them here every single time.

Mr. Speaker: Further supplemental, the member for Vancouver–Mount Pleasant.

J. Kwan: The question to the Premier is: what search did he do, and will he table the documents today? It is clear, it seems to me, that there has been no extensive search. You simply owe the Liberal insider a favour. What better way to show appreciation than a plum job that vaults both Mr. Wilkinson and Ms. Dawson into the upper reaches of the non-partisan civil service that the Premier is so fond of…? Will the Premier just do the right thing today: admit that there was, in fact, no search — never mind a nationwide search — and use question period today to remove these two political appointees from their comfortable patronage appointments?

B. Lekstrom: My question is to the Minister of Transportation. The heavy rains and flooding in the Peace River area have caused much widespread damage to our area. Many of the roads and highways have been flooded and washed out. Having just visited the Peace region, can the minister tell me what her ministry is doing to make sure that this hardship being created by the floods is being looked after for the residents of this region?

Hon. J. Reid: Indeed there was a very significant flood event in the last month, month and a half. Being up there this past weekend, looking at the damage, there's barely a road that hasn't been impacted by this. The provincial emergency program has been working with the province and with local governments to identify the most serious areas to help the residents. With my ministry we have put additional resources of people up there to start working on these problems, resolving them. The new construction and the repairs are underway right now, and we expect that all the major routes will be reopened within the next few days, if they aren't already. They're trying to get them opened for today, and that construction work will continue on.

B. Lekstrom: My supplementary is to the Solicitor General. Minister, I understand that the provincial emergency preparedness program is designed to respond to provincial disasters. Can the Solicitor General tell us what steps, if any, the PEP program is taking to assist the residents of northeastern British Columbia?

Hon. R. Coleman: Our officials were on the ground immediately, right at the beginning of the issues that happened in the north with regards to flooding. They had already assessed it. They had been coordinating all the ministries, including highways, and all the environmental issues to make sure things happened.

We've got a very good provincial emergency program in this province, with over 20,000 volunteers coordinated by the centre. They've done an excellent job in the north. They'll continue to coordinate it and continue to make sure that the solutions are found for the north in this province.

J. Les: My question is to the Minister of Heath Services. Currently, we in the Fraser Valley face a serious situation with respect to an outbreak of meningitis C. All members of the House will know that this is a very serious illness. I've personally had experience with this many years ago, when one of my sisters had meningitis. Thankfully, she recovered fully, but I saw at first hand how serious and devastating this disease can be. Can the minister tell the House today what steps he is taking to ensure that British Columbians at risk are protected by a provincewide vaccination program?

Hon. C. Hansen: Since the meningitis outbreak was identified in the Abbotsford area in April, certainly the work that has been done by the local medical health officer has been extraordinary in getting the word out to young adults between the ages of 18 and 29 to get vaccinated. That is a free program that is being put together. Any British Columbians between the ages of 13 and 29 who may have had any contact — being saliva exchange — with any 18-to-24-year-old residents in Abbotsford are also provided with the free vaccination. In addition, that has been expanded to include the Mission area, as a result of one case that was identified that originated in Abbotsford.

The provincial health office is monitoring this on a daily basis. They're in contact with the health officials in the Fraser Valley. They are looking at it with the public safety and public interest in mind. It is their determination, as a result of a very comprehensive meeting that was held last Thursday, that a provincewide program of vaccination is not required at this time.

So I think the message to British Columbians is that if they are in those risk groups, living in Mission or in Abbotsford, they should be concerned. They should take advantage of that free vaccination. If they live outside of that area, the best medical advice is telling us that there is not cause for alarm, but certainly it is being monitored on a daily basis.

Hon. G. Collins: Hon. Speaker, I move that this House at its next sitting resolve itself for this session into a committee to consider the supply to be granted to Her Majesty.

Hon. G. Collins presented a message from His Honour the Lieutenant-Governor: Estimates of Sums Required for the Service of the Province for the fiscal year ending March 31, 2002, and a supplement to the estimates for the fiscal year ending March 31, 2002, recommending the same to the Legislative Assembly.

Hon. G. Collins moved that the said message and the estimates accompanying the same be referred to Committee of Supply.

Hon. G. Collins: Mr. Speaker, I move, seconded by the Premier, that the Speaker do now leave the chair for the House to go into Committee of Supply.

On May 16 of this year, after a decade of decline, British Columbia elected a new government and sent a clear signal. They wanted change. They wanted their province to move in a new direction. They voted for a new era of hope and opportunity, and this government is going to deliver.

British Columbia has incredible strengths, vast resources and the most talented people anywhere. British Columbians told us on May 16 that they were tired of seeing those advantages squandered. This province started the last decade as an economic powerhouse, but within ten years we moved from the front of the pack to the back of the pack in almost every category that counts.

We went from one of the fastest-growing economies in Canada to one of the slowest-growing economies in Canada. We went from a competitive tax environment to one that was uncompetitive in many key areas. We watched as British Columbians' real disposable incomes fell year after year after year. Not surprisingly, the mood across the province went from hope and enthusiasm to disappointment and even despair.

The families in our communities deserve better. Our history and our future demand it. This government committed, during the election campaign,

to return British Columbia to its rightful place as a leader in Canada and around the world.

The Premier promised bold and innovative change. We promised a new era of hope and prosperity, and today we take the next steps in fulfilling those commitments. Today we begin to build that new era of hope and prosperity for every British Columbian. But before we move forward, we need to establish a starting point, a baseline for future accountability. So I'd like to present the House with an update of this year's economic and fiscal status.

I want to be clear that this is just an update today. We will deliver our first full provincial budget on February 19, 2002, including a comprehensive three-year fiscal plan. The update I'm about to deliver is only an interim step, based initially on the provincial budget that was introduced to this House on March 15. However, since then much has changed. To revive our economy for the long term, on our first day in office we cut personal income taxes by 25 percent, and I'll be announcing further tax reductions today.

As well, the economic outlook for the United States, Europe and Asia has weakened, and that has had a negative effect on British Columbia's exports, including energy and electricity.

Since March 15 we have seen our revenues decline by $1.85 billion, to $22.7 billion. At the same time, expenditures have risen by $455 million, to $24.75 billion, mainly because we have chosen to include a number of expenditures that weren't fully recognized in the March budget but are expenditures we are going to face nonetheless.

As well, Crown corporation income has strengthened very slightly, with a net gain of $23 million. In all, this means that our spending exceeds revenues by $2.28 billion. After the forecast allowance of $500 million and a one-time-only joint-trusteeship agreement benefit of $1.28 billion, the overall summary accounts deficit is $1.5 billion. And that's where the province's finances stand today.

Clearly, with those numbers we face a challenge, a very serious fiscal challenge. It must be overcome, and it will be overcome, because we just can't afford to continue down the old road of poor planning, overspending, overtaxation and economic decline that we've seen for the last decade.

Last week the fiscal review panel concluded that British Columbia has a structural fiscal imbalance. If we did nothing, if we kept doing what we've been doing as a province for the last decade, even without tax reductions, British Columbia would face a deficit of $3.8 billion in the next three years. The panel said that if we kept doing what government did for the last decade, we would be in significant trouble.

But as you know, the panel wasn't entirely pessimistic. It also said that our fiscal problems can be solved with fundamental changes in the way government operates. We are taking that advice to heart.

You heard the Premier speak about a core review of all public sector programs to assess, in a logical and systematic way what government's business is, how we are going to do it, and how we can do it better. We expect to begin to see results from that review in the next few months, but that does not mean we are going to wait to take action. Frankly, British Columbia has waited long enough. We know what we have to do to solve our fiscal problems.

Number one, we need to make our tax system competitive, as our first step to revitalizing economic growth. Number two, we have to bring some discipline to spending, with strong, accountable fiscal management. I'm announcing action on both fronts today, starting with a series of measures to get our economy growing again.

Mr. Speaker, over the last decade it's no news, I think, to most British Columbians that their standard of living has declined. While other jurisdictions have enjoyed record growth, the average British Columbian's real disposable income — that's the money they take home at the end of the month, the end of the year — has fallen by more than $1,700 a year. Investment growth has lagged behind almost every other province in Canada. Too many business owners and too many skilled workers have felt compelled to leave the province, and British Columbians won't stand for that any longer.

British Columbians won't stand by and watch what they've seen for the last decade as all the investments, all the good jobs and all the businesses go to competing jurisdictions like Alberta and Washington State. If we don't do something now, over time British Columbia will wither away and end up being a have-not province without the economic strength to support the quality of social programs that everybody wants to provide. That's not what British Columbians want, and that is not what they deserve. It's not what this government wants either, Mr. Speaker, and we've already begun to make that clear.

During the election we promised dramatic personal income tax cuts within 90 days of taking office. We delivered on day one, our first full day on the job, cutting personal income taxes by an average of 25 percent for every single British Columbian who is paying personal income tax. Starting January 1, 2002, a little over five months from now, British Columbia will have the lowest tax rates of any province in Canada for the bottom two income brackets, which apply to all taxable income under $60,000.

During the election we also promised to make British Columbia a more competitive place to invest and to do business. Today I'm pleased to announce a new series of tax reductions designed to increase investment; to begin to revitalize industries like logging, mining and transportation; to strengthen the emerging sectors, such as high technology; and to break down other barriers to economic growth. It's time to get British Columbia moving again.

Some of the barriers that we face, some of the barriers to growth in British Columbia, are tied to complex, sensitive issues that can only be resolved over time. For example, a lack of certainty around aboriginal

land claims and questions about long-term land use planning continue to impact economic growth and investment. Those issues will be addressed in the months ahead as part of our broader strategy to bring prosperity back to British Columbia.

In the meantime, we must address the tax issues responsible for driving investment and business away. For example, for many years British Columbia has been the only Canadian jurisdiction to charge provincial sales tax on production machinery and equipment without offering any significant offset for business. In a world where there is stiff competition for every single investment dollar, that makes no sense. So effective midnight tonight, we are axing the tax. We are eliminating the PST on production machinery and equipment bought by eligible manufacturers and by businesses in the logging, mining and energy sectors.

That tax change will save businesses in British Columbia $87 million this year and allow them to put that money back into investment both in traditional resource industries and in emerging sectors such as high technology, manufacturing and software development.

Our next major tax cut will also encourage new investment, especially from overseas, and it will make a real difference for British Columbians here at home. In 1992 the NDP introduced the corporate capital tax on non-financial institutions. It sent an immediate and intense negative message to Asian investors and other potential investors around the world. But this tax doesn't just affect investors outside British Columbia. It is also paid indirectly by small businesses and startup companies through their rent and lease arrangements in the form of triple-net leases where they pay those taxes.

That won't be the case for much longer. We are phasing out the corporate capital tax on non-financial institutions. The rate will be cut in half, from 0.3 percent to 0.15 percent, on September 1 of this year, and the tax will be eliminated in its entirety on September 1, 2002. This move will free up more than $100 million and leverage significant new investments in our province from within British Columbia and around the world. It will also bring B.C. back in line with most of the rest of the developed world, where capital taxes are recognized for what they are: disincentives to growth.

As well, B.C.'s general corporate income tax rate is currently amongst the highest in Canada and is also a significant deterrent to people doing business in British Columbia. As a further step to make our tax competitive, we are going to reduce the corporate rate by a full three percentage points, to 13.5 percent, effective January 1, 2002. This message is also important. We intend to strive to make sure that that rate remains competitive in the years ahead as our economy grows.

I am also announcing today a series of tax changes to strengthen the transportation and mining sectors. These include cutting the tax on domestic jet fuel from 5 cents a litre to 2 cents a litre. That will bring our domestic rates in line with what is currently on international flights and with the rates charged by our competitors. That tax reduction will also apply to aviation fuel, which will also be reduced to 2 cents per litre.

As well, we are going to eliminate the 7 percent tax on bunker fuel used to run large ships, opening opportunities to supply more fuel to ships visiting British Columbia ports and helping attract more cruise ship business. I expect that the member from Prince Rupert and those others who come from areas that rely on the shipping industry as part of their community's economic activity will be pleased to hear about that kind of change.

As well, one of the industries that has been almost devastated by ten years of the previous administration is the mining sector. Today I'm introducing a new 20 percent flow-through share credit for mineral exploration modelled on the federal tax credit. People who don't use flow-through shares will still be able to use the existing mineral exploration tax credit. That will help to drive exploration here in British Columbia and to make sure the mining sector continues to provide high-paying jobs and revenues to government to pay for health care and education.

Another tax that the NDP introduced in 1992, which I think was part of the attack that the then Minister of Finance placed on a number of people in British Columbia, was what he called the luxury tax on vehicles. As Finance critic over the last number of years, when I travelled around British Columbia, particularly rural areas, it was the single issue I heard the most from people who live in rural British Columbia. So we are reducing the surtax on new vehicles that penalized people for buying the cars and the trucks that they need in rural areas for work, business and family use. This tax is added over and above the 7 percent PST that everyone pays when they buy a new vehicle in British Columbia. The tax currently kicks in at $32,000, placing an unfair burden on people who need larger vehicles for work and safe travel, not to mention people who have a disability and need a larger vehicle just to get around.

I've heard from community care nurses around British Columbia who find it astonishing that the government would punish them for having a vehicle that will make sure they can safely get to their patients to deliver the patient care that they need in some of the most demanding terrain and most demanding climate anywhere in North America. So effective midnight tonight, we're lifting some of that burden by raising the threshold from $32,000 to a more realistic level of $47,000.

In total these tax changes will put $248 million back into our economy this year alone. Combined with our personal income tax cuts and other policy and regulatory changes, which will be spearheaded by the Minister of Competition, Science and Enterprise and the Minister of State for Deregulation, these moves to a more competitive tax system will start to renew our economy this year and set the stage for even more significant growth next year. Anyone who doubts that

need only look as far as the impact of our personal income tax reduction. We announced it less than two months ago, and it took effect less than a month ago. Already people are seeing our province in a new light. Business confidence is up dramatically, and so is consumer confidence.

In fact, after a decade of decline and despair in private sector investment, the Conference Board of Canada has just reported a huge 20 percent increase in its B.C. consumer confidence index, compared to a rise of just 3 percent nationwide. We believe this confidence will translate into growth of 3.8 percent in our economy next year, up significantly from the 2.2 percent expected this year. Tax cuts will allow businesses to once again create jobs, compete and attract investment. They send a message here at home and around the world that B.C. is back and ready to lead again.

Leadership is about responsibility. It calls for bold, decisive action like we're taking here today. It also calls for humanity, compassion, understanding and empathy for people's needs and priorities: health care and education. These are the top priorities that the people of this province have identified again and again, and they're our priorities too. But I have to ask: how does a province with the slowest-growing economy afford the best social programs in the country? And the answer is: if we don't change anything, we can't, not in any sustainable way. But in a province with a vital, vibrant economy, we can afford high-quality public health care and education. That is why it's so essential to get our economy back on track.

British Columbians will also want a top-notch education system. We want our schools to be at the leading edge of educational achievement and excellence, and with the innovative ideas being put forward by our Minister of Education, we will achieve those goals.

We also want a public health care system to guarantee all patients the care they need where they live and when they need it. I know the Minister of Health Services and the Minister of Health Planning are working every waking hour trying to make that happen.

This government has an unflagging commitment to these objectives. Despite some of the comments that were made by members of the NDP during the election campaign, I'm pleased to reaffirm here today that as promised by the Premier and the members of our party, we will maintain funding for both health care and education.

The health care budget will be up $9.5 billion this year. That's up $1.1 billion from last year. The budget for K-to-12 education is $4.8 billion; that's up from last year as well. We will increase those levels in the future as we reap rewards of new growth and prosperity in our economy.

Mr. Speaker, the tax cuts I've just announced will help achieve prosperity, but tax cuts are only part of the answer. It's just as important to properly manage the $68 million a day that the government of British Columbia now spends on behalf of the taxpayers. We must ensure that every single one of those dollars is spent wisely, and we have a strategy to make that happen.

Mr. Speaker, our strategy includes a core services review, which the Premier will be making further comment on in the very near future. It's a top-to-bottom examination of every government program and service to make sure we focus resources where they're needed the most. Once we've done the review, we'll publish three-year budgets and service plans that tell people clearly what they can expect from our government. On budget day next year, beginning February 19, we will set out what we're going to do, how we're going to do it, what results we expect to achieve and how much it will cost.

We will also provide health authorities, school boards and post-secondary institutions with three-year funding commitments so that they can finally plan and act with the certainty that only comes with long-term secure funding. Finally, we are implementing an all-out attack on red tape, business subsidies and waste. Thanks to our new waste-buster website, we'll have four million sets of eyes looking for and reporting on government waste across the province. These steps will ensure that we get the maximum value from every dollar.

Today I am also tabling two pieces of legislation that will form the legal framework for our fiscal plan. The Balanced Budget and Ministerial Accountability Act mandates a balanced budget by 2004-05 and for every year thereafter. It also makes us more financially accountable by tying ministers' salaries directly to our budget targets. [Applause.] Mr. Speaker, I noticed more applause from that side of the House than this side.

Starting on April 1, 2002, the government will automatically withhold 20 percent of cabinet members' ministerial salaries. Ministers will be able to earn back 10 percent by meeting their ministry budget targets. The other 10 percent will be paid out only if we meet our provincial budget target, providing a new level of both individual and collective political accountability — as well as spousal accountability, I might add.

Mr. Speaker, the second piece of legislation I'm tabling today amends the existing Budget Transparency and Accountability Act to ensure we move to fully implement generally accepted accounting principles so that government keeps its books the way people keep their books. In addition, it eliminates the traditional use of special warrants. Unlike previous governments, we don't believe in spending the people's money without due process and debate in this, the people's Legislature.

We will eliminate the use of special warrants with the exception of two very rare circumstances: in the case of a natural disaster such as an earthquake, where for some reason the Legislature couldn't be recalled to pass supply; or in a very brief period following a new election, where a new government needs to provide services to the public. Mr. Speaker, this is one more

We understand that what we call government revenue comes from the pockets and the purses of British Columbians. We understand that the money isn't ours to spend however we please. It belongs to the people we serve, and we have a duty to manage it wisely. We have a duty, also, to deliver on our promises and our commitments to re-establish British Columbia's leadership role in Canada — to have the leading economy in Canada and the highest level of private sector investment anywhere.

Will it be easy? The answer, clearly, is no. There are going to be bumps along the way, and we will face difficult and contentious choices. But nothing of real value comes without a challenge. And I can't think of a challenge more deserving of our efforts than the challenge of rebuilding the province of British Columbia.

Mr. Speaker, I was born and raised in Saskatchewan, and every summer my family would come and visit B.C. As far back as I can remember, this is the place where I wanted to be. It wasn't just the mountains and the rivers; it wasn't just the cities or the beaches or the forests. What I felt as a young person visiting this province was a sense of hope, a sense of incredible opportunity, a sense that this was a place where great things could happen.

It's saddened me in recent years, just as I know it's saddened so many British Columbians, to see that sense of opportunity evaporate and see the mood of the people turn from hope to cynicism. Over the last ten years they've seen their paycheques shrink, their tax burden rise, their opportunities narrow. So who can blame them for feeling cynical?

A few people console themselves by saying, "Oh well, we're not as badly off as some other province," because if you look hard enough, you can always find some other jurisdiction that's faring a little bit worse. But is that the way we want to measure ourselves in British Columbia? Is that as good as it gets?

British Columbians deserve better, and the fact is that we haven't been living up to our full potential for some time now. Our resources are immense, and our people have unlimited talent. With sound fiscal management, clear priorities and bold, innovative changes, we can sweep aside that sense of hopelessness and despair and create a new sense of optimism and energy that is British Columbia. We can build on the rubble of the last decade and re-establish this province as a place of opportunity, and we can truly deliver on a promise of a new era of hope and prosperity for all of us in the best province in the best country in the world. Once again we can be proud to say we are from British Columbia.

J. MacPhail: I rise today in response to the Liberal government's first budget. It is clear that as we bring forward our budgets, we make choices. As all of us know, whether in our business lives or our personal lives or our political lives, choices involve the assumption of risk. I think today is the first day that the Liberal government must take responsibility for its actions. Today is the day that you must look forward and say: "We have changed things so radically that it is now our responsibility." It will no longer be available to the Premier to look back and blame the last ten years….

J. MacPhail: It truly is the day that you will stand up and take responsibility for your actions, and of that you're very proud. Seventy-seven of you sit here, and you're very proud. I accept that.

I know that today's the day that you have to take responsibility for all aspects of it — that you take responsibility for the economy and you take responsibility for your guardianship role as providing public services for those in need. I actually wish you well; I wish you the best.

I see that you're taking massive, massive risks in this budget, and for the sake of British Columbia, I hope that you're right. This budget isn't balanced; it's not balanced in any way. It has the second-largest deficit in B.C. history, and it has taken a very one-sided approach to how to stimulate the economy. It has taken an approach that favours the wealthy and businesses, and it has taken an approach that says: "There will be no risk taken on behalf of people who need health and education services, who may need improved health and education services."

But having said that, it is a clear stamp. There's no question. It is a Premier Campbell, Liberal stamp on this budget. And the ad in this "advertising for people" is now accurate. People who come to this province will have to be able to work in an atmosphere of ambiguity and risk. That was the intent. You knew you were going to bring in this budget, and that's why you've put this ad in place. It actually turns out to be a very, very honest and accurate ad.

People coming here to manage our public services and our economy now will be in a situation of risk. Today there was risk added to British Columbians in the form of about $250 million more in tax giveaways to corporations and big business. Fair enough. But what is at risk because of that? What have you put at risk?

Well, you've put our nurses at risk — not only our nurses but our doctors staying in this province — and that was clear in this budget. Were there other aspects of the risk, perhaps — that you could have added maybe a little bit of trickle-down for those who aren't part of big business and corporations?

The trickle-down theory of economics which this government espouses has made sure that all the potential benefits of that risky theory are paid up front to big business. Today you delivered hundreds of millions of dollars to big business. You took the risk. You don't know whether it's going to work or not, but

Did the government share any of the risk for people who aren't big business and didn't pay large amounts of money to re-elect this government? Perhaps the government could have actually contributed just a tiny bit in advance of the risky outcomes on the trickle-down theory, for those who aren't their corporate backers. But indeed, not only do people who are not big corporate givers not get any of the advance benefits in a risky situation, but they were actually put even further at risk.

We already mentioned nurses. We mentioned doctors and health care professionals. But what about youth? I actually remember some outstanding comments from some of the members on behalf of youth, and today the labour market programs for youth are put at risk. Children and family services…. The Premier himself, when he was Leader of the Opposition, espoused passion and compassion for those that were beholden to the Ministry for Children and Families, and today we see no risk taken on their behalf — absolutely none.

Big giant risk, hundreds of millions of dollars, for the corporate world, and not one iota of risk was taken for those families that the then Leader of the Opposition was so passionate and compassionate about. People on welfare. It's true they probably didn't contribute much in the election, but the Human Resources budget is cut today.

Aboriginal education. The Minister of Education has a very, very aggressive program for education. Not once are aboriginal children mentioned, even though we know that our aboriginal children are the ones at greatest risk for success in the province. Gains have been made in the last decade, but there's much more to be done — not one iota of contribution to eliminate their risk.

Sexual assault centres. The Ministry of Community, Aboriginal and Women's Services had their budget cut. Sexual assault centres are put at risk now as well. I do laud the government. I do laud the Minister of Finance for continuing to fund the Child Care B.C. Program. He didn't mention it in his budget. Clearly, it's not something this government feels the necessity to advocate for people, but nevertheless, the money is there for that budget.

So there is much risk. The business community will rise up today and say: "Thank you very much for taking that risk. Don't worry about whether it will come true. We're very happy that you said the economic forecast is going to be 3.8 percent for next year," although no one else in the entire world, including their own fiscal review panel, is suggesting anything even close to an economic forecast of 3.8 percent.

Even though the forecast for the United States economy is going down, down, down, as recently as last Friday, this government is taking all of the risk.

My gosh, what did they say when others took that kind of economic forecast risk? What were the words? Their own fiscal review panel said, "Worry about the economic downturn," and gave an economic forecast that wasn't even close to what this government has done. But why risk being able to give your corporate backers big taxes?

It will be interesting to see whether the legislation for which this government pats itself on the back because they're going to be taking a salary cut actually does anything for British Columbians in the next eight months or so. I expect, when the legislation is tabled, we'll find out that it doesn't even come into effect until next year's budget. Certainly, there's absolutely no requirement for this government to balance the budget before the year 2004 or '05.

Secondly, there is absolutely no requirement for them to even attempt to reduce deficits. There's no requirement whatsoever for the next budget, the budget after that or the budget after that to do anything in reducing deficits. The government is let off the hook completely. And there's a reason for that. It's because they know the risks they are taking. Providing services and keeping our books balanced are put at great risk by their massive tax cuts to the corporations and the wealthy.

I do know who their model is. We know full well that the Premier of this province has taken a page out of the southern hemisphere — the great Douglas experiment from New Zealand. Just a couple of comments on how well that experiment has worked.

Tax cuts were paid for by reducing public spending on education, health and welfare. In fact, eventually the rates were raised on low- and middle-income people. The bottom 80 percent of New Zealanders have seen their standard of living fall after 15 years of these extreme forms. There's more poverty in New Zealand today than there was when the experiment began. Workers in New Zealand also face reduced social protection. For many of them, their real wages fell; their working conditions worsened. Most importantly, the revenues did not return to the government coffers.

Let's just talk about what's happening around the same "let's make big tax cuts for the corporate and the wealthy, and that will be the way in which the economy grows." Let's look at what's happening in Texas.

Texas, under Governor George Bush, is doing exactly the same thing that the Premier advocates — exactly the same thing. He pushed through a $1.85 billion tax cut. The state's budget had a surplus, actually — the same thing that this government was given: a surplus.

Yes, there was one thing that this government was handed: two years of a balanced budget and the largest

But let's look at what happened in Texas. The latest Texas budget forecast shows that they can expect a $700 million deficit after their $1.85 billion tax cut. In fact, they're now facing a discussion of possible new tax increases.

So it is a budget of great risk, and it is a budget where the choices are clear. It is now a time for the Liberal government to take complete responsibility for the present and future of British Columbia, because this budget drew the line in the sand. The budget….

J. MacPhail: The line drawn in the sand is very clear. Above the line, all of the risk will be managed on behalf of big business, the corporations and the wealthy in this province. Below the line will be people who need more services, certainly don't need their services reduced, can't afford to have their welfare reduced, need better help for children and families — probably what people thought they were going to get after listening to the then Leader of the Opposition — better resources for aboriginal children in our education system, better environmental protection as the world takes on the huge battle around global warming, better protection for our forests and better protection for small businesses, none of which was acknowledged in this budget.

It will be interesting to see, as the days unfold and the public takes account of the agenda of the Liberal government, how they personally view what they were told during the election and what the results are. I will watch with great interest, because the risks taken today were uncontemplated just 90 days ago. It's up to the government to prove that these risks will benefit all British Columbians. All of the eyes that they want to watch so intently on their great agenda will be watching them, will be watching to see how this budget delivers for the single mom, the small business owner, the transit driver, the nurse, the health care worker, the environmental technology small business person, first nations, the multicultural community. They'll all be watching them. I will have a great deal to say as we go through it, line by line, over the coming days.

Hon. G. Collins presented a message from His Honour the Lieutenant-Governor: bills intituled Taxation Statutes Amendment Act, 2001; Corporation Capital Tax Amendment Act, 2001; Balanced Budget and Ministerial Accountability Act; Budget Transparency and Accountability Amendment Act, 2001.

Hon. G. Collins: Mr. Speaker, I move first reading of the bills I've just given you.

Hon. G. Collins: These bills will provide legislative authority for many of the key initiatives announced in the economic and fiscal update. They also provide the legislative framework to fulfil four of the government's 90-day commitments: to introduce a dramatic cut in personal income taxes, to introduce real balanced-budget legislation that requires a balanced budget by 2004-05 and that makes ministers individually accountable, to introduce real truth-in-budgeting legislation that requires the province's finances to be reported under generally accepted accounting principles, and to establish a fixed day for the tabling of future budgets.

The amendments in Bill 2, Taxation Statutes Amendment Act, 2001, support the government's June 6 announcement to cut British Columbians' personal income tax by 25 percent. The bill also contains the tax cuts announced in the economic and fiscal update that are designed to return British Columbia to a position of economic leadership. They include the phase-out of the corporate capital tax; a 3 percentage point reduction in the general corporation income tax rate; a new provincial sales tax exemption for production, machinery and equipment purchased by eligible manufacturers and producers — the exemption will replace the existing 3 percent investment tax credit; a new 20 percent flow-through share tax credit to encourage mining exploration in British Columbia; an increase in the threshold at which the vehicle surtax comes into effect; and several measures designed to strengthen British Columbia's transportation system.

Bill 3, the Corporation Capital Tax Amendment Act, 2001, repeals the sections of the act which will no longer be required once the capital tax on general corporations is phased out. These repeals will be effective on September 1, 2003.

Bill 4, the Balanced Budget and Ministerial Accountability Act, repeals the existing Balanced Budget Act and establishes new requirements. This bill prohibits annual budget deficits commencing in 2004-05, and through the establishment of a 20 percent salary holdback for ministers and the Premier, it enhances collective and individual accountability for the achievement of expenditure and performance targets.

Finally, Bill 5, the Budget Transparency and Accountability Amendment Act, 2001, makes amendments to the Budget Transparency and Accountability Act and the Financial Administration Act regarding the overall government accountability framework. It also repeals the Environment and

Sustainability Statutes Amendment Act, 2001. The key amendments to the accountability framework are to eliminate the use of special warrants except in two very specific situations, provide for the adoption of generally accepted accounting principles in establishing government accounting policies, set the annual budget date, increase disclosure in budget documents and require individual ministerial accountability for service plans.

Bills 2 through 5 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.